Recent updates have brought a difficulty selection. Any rules regarding this?

Nope. No reason for them.

the difficulity only appear after you fail them once, so it's only there if you failed and lost time regardless (unless you fail the 1st few seconds in and go for very easy, it really makes a difference)

That is simply untrue. You are presented with a difficulty selection upon beginning any solo duty.

As shown here, from my own (failure-less) run: